Tips for making an offer on a property?

[inferno]

Hi guys,

Does anyone have any tips of what you should be doing to make an offer on a property? What type of percentage should be looking at offering below if its been on the market a couple of months? Does being a first time buyer and having no chain help?

Cheers!

 

[D.P.]

All depends what you think the property is worth and how much you want it. If you really want the property then just offer the asking price and be done, if you dont care then you can try to offer less and see what happens. being a FTB only helps if the seller is looking for a quick sell, and in whcih case there is a good chance they have already priced it to sell.

 

[Haggisman]

Don't just make a low offer for the sake of it; look at what similar houses in the area are selling for, look at what's wrong with it, what would cost you money to do up etc. The buyer has most likely got an idea of what they want for it, and unless they are desperate to sell or you can demonstrate why it's worth less than that, they'll most likely decline anything lower.

 

[Bickaxe]

Do you have a mortgage in principle? Some sellers will not even entertain an offer if you do not.
An offer also depends on the price it is on for, without knowing anything about the place, its hard to give advice. As a percentage, 5% would be okay. But that depends on location too.

Is there anything wrong with the property, pointing these things out will help and you need an idea of the cost of those things too.
Think about the competition too, a developer or landlord is highly likely to beat your offer if they want the place.

 

[D.P.]

Similarly, don't be surprised if the property sells for well above the asking price.

 

[dowie]

Don't just make a low offer for the sake of it; look at what similar houses in the area are selling for, look at what's wrong with it, what would cost you money to do up etc. The buyer has most likely got an idea of what they want for it, and unless they are desperate to sell or you can demonstrate why it's worth less than that, they'll most likely decline anything lower.

I think it is fine to make a low offer for the sake of it, it is part of the price discovery process tbh..

In fact in today's market you're quite likely overpaying if you don't - over 80% of properties sell for less than asking price these days.

 

[dowie]

Similarly, don't be surprised if the property sells for well above the asking price.

don't be surprised if it sells for less more like

 

[Haggisman]

I think it is fine to make a low offer for the sake of it, it is part of the price discovery process tbh..

In fact in today's market you're quite likely overpaying if you don't - over 80% of properties sell for less than asking price these days.

Well... maybe, however you're more likely to have success, and less likely to **** the buyer off with an "insulting" offer if you can qualify why exactly you're offering £20k less than the asking price

Ultimately depends how much you want /that/ house

 

[dowie]

Well... maybe, however you're more likely to have success, and less likely to **** the buyer off with an "insulting" offer if you can qualify why exactly you're offering £20k less than the asking price

Ultimately depends how much you want /that/ house

If they feel offended then they're a bit weird tbh... it isn't likely and low offers happen in the vast majority of sales. You don't need to justify anything - you can literally say to the estate agent 'will he/she accept X' and the estate agent will pass on the offer. It doesn't require a convoluted narrative behind the price beyond you simply believing the property isn't worth the asking price... and at the moment, over 80% of the time, you'll right by default that it indeed isn't worth the asking price.

I gave a very cheeky offer when buying a place in London, I was quite upfront with it to the agent - it was a buy to let property that the guy wanted to get rid of quickly because his wife had died suddenly and she used to manage it. I pointed out that I'm a first time buyer with a mortgage approval and could close ASAP therefore would he accept X. Agent said it seemed a bit low but she'd pass it on and emphasised the quick sale... he agreed to it.

 

[Haggisman]

If they feel offended then they're a bit weird tbh...

I wouldn't say "offended" is the right word, but if i was selling my house and someone offered me 5-10% below the market value, I'd assume they were just a time waster, politely decline their offer and move onto a more promising buyer

 

[dowie]

I wouldn't say "offended" is the right word, but if i was selling my house and someone offered me 5-10% below the market value, I'd assume they were just a time waster, politely decline their offer and move onto a more promising buyer

Fair enough but that is just you - objectively it is still the right thing to do as the data from a few months ago shows >80% of sales going through at lower than asking.

 

[Tom_ed1987]

As a FTB, the estate agent may insist on you presenting them with a mortgage in principle certificate. You may have obtained this for a vague amount (your max budget) before considering this actual house - Make sure you given them one that states the exact amount you are bidding and not any higher, or you are essentially showing your hand early.

 

[dowie]

As a FTB, the estate agent may insist on you presenting them with a mortgage in principle certificate. You may have obtained this for a vague amount (your max budget) before considering this actual house - Make sure you given them one that states the exact amount you are bidding and not any higher, or you are essentially showing your hand early.

But your mortgage is only going to be for a % of the offer and your deposit can vary. The only way it is going to state the exact amount you're bidding is if you have a 100% mortgage. It doesn't matter much anyway in this market - the agent wants to make the sale not push too much for a higher price despite whatever they've told the vendor - they're simply incentivised to close the deal.

see:

 

[Ant84]

If you're not embarrassed by how low your first offer is, it isn't low enough.

You've got nothing to lose.

 

[D.P.]

don't be surprised if it sells for less more like

Depends where you live and the market conditions. My sister sold her house for about 7% over asking price last year.

 

[D.P.]

I wouldn't say "offended" is the right word, but if i was selling my house and someone offered me 5-10% below the market value, I'd assume they were just a time waster, politely decline their offer and move onto a more promising buyer

It is a common occurrence. The sellers have a price in mind and wont want it sold for less otherwise they liekly would have priced it lower anyway. While most of the time the seller wont care some will just ignore any offers from you in the future even if they get close to the asking price. If is oyur dream house it isn't worth the fuss over a few percent.

 

[D.P.]

If you're not embarrassed by how low your first offer is, it isn't low enough.

You've got nothing to lose.

There can be a lot to loose, like loosing out on your preferred house.

 

[dowie]

Depends where you live and the market conditions. My sister sold her house for about 7% over asking price last year.

Sure, but in general, in the UK.. obviously there will be exceptions - but for the vast majority of scenarios you should offer lower... nothing to lose generally - if it is genuinely too low and the agent can't persuade them to take it then they'll tend to come back and ask you to offer more.

 

[philldutton]

It will depend on your area. If the house has been on the market for a while and they have no other offers then you have nothing to lose by offering a lower amount and then negotiating.

Not that my advice is worth much, I made an offer (in the middle of the "guide price" range) on a house a couple of weeks ago which had a number of people viewing and the seller accepted another offer without the estate agent giving me a change to increase it.

 

[Daaaavvveee]

Currently we are looking at houses circa 400ish in value, I would have no issues in offering 50k+ off the asking price and see what happens.

All they can do is say no, and counter, so you will then get a better idea for what they actually want.